Mandatory Licence

This nationwide licensing scheme applies to larger HMOs with five or more tenants from at least two separate households. 

Introduced in 2006, it covers houses or flats that lack all amenities behind a lockable front door. 

Additional and Sec 257 Licences

Local Councils, following local consultations, can implement additional HMO licensing schemes. These apply to smaller HMOs, regardless of the number of storeys, where three or more tenants from at least two households reside. 

Additionally, property owners responsible for managing common areas in buildings with self-contained (leasehold) flats may require an additional licence for those shared spaces.

Sec 257 refers to a building converted into self-contained flats where the conversion does not apply to Building Regulations unless two-thirds of the flats are owner-occupied.
 

Selective Licences

Local Councils have the discretion to require a licence for specific properties, areas, roads, or properties with a minimum number of occupants.

Households

The definition of a household, for the purposes of the Housing Act 2004, could be a single person or members of the same family living together.

They are:

• Couples married to each other or living together as husband and wife (or in an equivalent relationship in the case of persons of the same sex)
• A family living together, including parents, grandparents, children (and step-children), grandchildren, brothers, sisters, uncles, aunts, nephews, nieces or cousins and their partners
• A foster child living with their foster parent

Granting of a Licence

The Council will take into account various health and safety measures available at the property before granting a licence.

For example:

• Up-to-date Gas Safety checks
• Certification for all electrical appliances
• Fire Safety and risk assessment, including smoke detectors, carbon monoxide detectors, fire extinguishers
• Adherence of upholstered furnishings and coverings to regulations
• Suitable facilities for refuse storage and disposal
• Common areas are kept in good repair
• Adequate amenities such as cooking, washing and bathroom facilities

The Council will also take into account:

• the number of occupants in the HMO
• the suitability of the shared facilities for the number of occupants
• the suitability of the landlord who owns or has control of the property
• the ‘fit and proper’ test of the Managing Agent, or whoever is responsible for the management of the property on a day-to-day basis

Following inspection of the property the Council may require remedial works to be conducted at the HMO if it finds any unacceptable risks that exist. The landlord will then be required to eliminate the risks by carrying out the required works.

Once a licence is granted the licence holder must display the name, address and contact details of the person responsible for managing the property in a prominent position in the common parts of the HMO

Fines & Penalties

• Failure to apply for a licence, or breaching the conditions of an existing HMO licence is a criminal offence
• Fines for a successful conviction are unlimited
• If the Council does not grant a licence, or if a licence is revoked, the Council may make an Interim Management Order, which will transfer management of the property for a specified period to the Council. Following this period a Final Management Order may be made
• A landlord cannot retake possession of an unlicensed HMO until a valid application is made
• A tenant occupying an unlicensed HMO may be entitled to claim up to twelve months’ rent back from the landlord (Rent Repayment Order)
• A landlord cannot evict a tenant to avoid licensing. In addition if a licence is granted but there are too many people living in the HMO according to the conditions of the licence, then the landlord will need to take reasonable steps to reduce the number of occupants at the HMO